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Taxation of Investment Products

Within the scope of the Income Tax Law provisional article no:67, relevant resolutions of the Council of Ministers and the explanations in the Income Tax General Communiques serial numbers: 257, 258, 263 and 269, the summarized tables that show the taxation principles of gains secured by natural and legal entities through interest on securities, trading of securities and interest on deposits in 2009, can be accessed from the links below.

• Taxation of gains secured by full taxpayer natural entities through Turkish Securities in 2009, 266K

• Taxation of gains secured by limited taxpayer natural entities through Turkish Securities in 2009, 282K

Elimination of the 10% Stoppage on Stock Transactions

The right that appears in the Income Tax Law provisional article no:67 has been exercised again by the Council of Ministers in accordance with the resolution dated 27.10.2008 and numbered 2008/14272. The aforesaid resolution was published in the Trade Registry Gazette on November 13, 2008. As of November 14, 2008, the stoppage rate applied to gains secured on stocks by full taxpayer natural and legal entities has been reduced from 10% to 0%. However, as this reduction will not apply to gains secured on the shares of investment trusts traded on the ISE and the mutual fund participation certificates, these gains will continue to be subject to a 10% stoppage.

The aforesaid reduction will only be in effect for gains secured on the trading of stocks that are subject to stoppage in accordance with the Income Tax Law provisional article no:67. This reduction will not include gains secured on government bonds, t-bills, futures and options contracts and mutual fund participation certificates. No changes have been made in regards to the taxation of these products and they will continue to be subject to a 10% stoppage in general.

For the Council of Ministers' resolution numbered 2008/14272, published in the Trade Registry Gazette on November 13, 2008, click here.